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1. Introduction and Summary

This Book describes the life journey of an American Legend - LEE IACOCCA, the businessman
who brought Chrysler back from the brink of bankruptcy and in process became a media celebrity,
newsmaker and a source of inspiration.
Lee Iacocca and his family were Italian immigrants. He worked very hard to get himself into the Ford
Motor Company. There he rose spectacularly through the ranks to become its president. His journey in
Ford was filled with ups and downs but he always managed to rise above the situation with his sincere
efforts, hard work and dedication. After dedicating 35 years of his life to the company, he found himself
amidst a game of power play, which eventually led to him getting fired from the presidency of the
company. But Lee Iacocca didnt get mad, he got even. He led a battle for Chryslers survival that made his
name a symbol of integrity, know-how, and guts for millions of Americans.
In his classic hard-hitting style, he tells us how he changed the automobile industry in the 1960s by
creating the phenomenal Mustang. He goes behind the scenes for a look at Henry Fords reign of
intimidation and manipulation. He recounts the miraculous rebirth of Chrysler from near bankruptcy to
repayment of its $1.2 billion government loan so early that Washington didnt know how to cash the check.

2. Statement of Objectives of the Study

To understand and analyze the varied pattern of human behavior.
Critically analyze the book, derive the concepts embedded within and relate it to the theories
studied in relation to Individual dynamics and leadership.
Use this opportunity to work closely in a group and enhance interpersonal skills


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3. Method of Study

The book was read by every member of the group and then the various parts were divided amongst
the group for further critical analysis which made sure that all aspects of the book were analyzed in
a detailed manner.
28 Chapters of the book were equally divided among the group members to write a detailed chapter
wise critical analysis.
Overall personality traits, perception, motivation and leadership qualities were the key topics that
were kept in mind while analyzing the book.
4. Chapter Wise Analysis & Critical Summary

Chapter 1 - The Family
This chapter describes the relationship between Lee Iacocca and his parents, especially his father. It
describes the early days when his father immigrated to America, with a penny to his name. He is described
to have had a natural flair for business, as he was successful in several businesses ranging from food to
entertainment. He instilled a great deal of knowledge of business in Lee throughout Lees childhood.
Several of Lees ideologies, attitudes & perceptions come from his father and from his experience with
the Great Depression, which is outlined in the chapter.

Chapter 2 - School Days
This chapter describes Lees experience as a kid. He was exposed to bigotry very early in his life. These
experiences did not stop there, he witnessed similar thing when he promoted a Jewish to the post of Vice -
Chairman. Inspite of this Lee had a pleasant memory of his school days- Academics, Latin club, music,
president of the school etc. As a child he suffered from an illness which almost killed him but ended up
saving his life as he was not drafted in the army. His college life at Lehigh University is where he
developed the ability to concentrate, time management & establishing priorities. Lee had to deal with the
pressure from his father to perform in college as good as he did in his school. Thus, his motivation was
mainly caused by his family, which was a type of self-fulfilling prophecy. His father was of the opinion
that since his son was so good in school that he had to be the best in college. Lee had four years of formal
training in Psychology, which helped him to understand the fundamentals of human behavior.

Chapter 3 - Getting My Feet Wet
The initial stages and breakthroughs of Lees career are described in this chapter. Lee was initially assigned
to the engineering department in Ford, but he managed to convince his employers to assign him to the
marketing department. This chapter describes Lees motivation to be in the people job & describes his
dedication to his employer, Ford. It also introduces Lees lifelong mentor- Charlie Beacham, whose
leadership qualities are briefly summarized. The central outline in this chapter resides on Lees dedication,
commitment & continuous innovation in the initial stages of his career with Ford.

Chapter 4 - The Bean Counters
The chapter starts with how Lee overcame the recession which hit Ford in early 1950s and his subsequent
demotion. But he doubled his efforts in coming years and introduced a new scheme of allowing customers
to do monthly payments, which later became the companys national marketing strategy and boosted the
sales of the Ford. This chapter also outlines Lees marriage, his wife Mary and him becoming the vice-
president and general manager of Ford division. This chapter introduces Robert McNamara, one of the
famous Whiz Kids of Ford who later became the president of Ford. It also outlines McNamaras ideas and
attitudes, which helped Lee in his professional life. Iacocca also speaks about the how the tussle between


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the financial division (bean counters - defensive and pessimistic) and sales & marketing division
(aggressive and optimistic) affected the companys performance.

Chapter 5 - The Key to Management
When Lee became the GM of Ford Division, he introduced the quarterly review system. This allowed the
managers and their respective supervisors to review their performance of the past 90 days and discuss the
goals for the next term. Hence, the deserving employees were not overlooked and the undeserving
employees would not get to hide in the system. This chapter also introduces a fundamental aspect of
decision making-Ideally, one should have lot of patience and should take a decision only after he has
obtained all the facts. However, in real life, a right decision becomes wrong if its taken too long. Certain
amount of risk-taking is essential. Lee also described that the only way to motivate people is to
communicate with them which is also the best way to develop ideas.

Chapter 6- The Mustang
After the spectacular success of the Falcon, another new car, the Cardinal was due to be launched. Lee had
flown to Germany to see the progress of the car. He didnt like the car and thought that it would be a
failure. After returning from Germany, Lee negotiated (a very strong example of Mintzbergs Decisional
Roles) with the senior management not to roll out the car and even though $35 million had already been
invested in the car. Lee, along with his team, started designing a small 4-seater car with an estimate of a
retail price of $2500 in late 1961. They decided the name of their new car to be Mustang. In the first year,
the Mustang was such an instant hit that Ford was forced to open up two more plants only for the
production of Mustang.

Chapter 7 - Encore!
In 1965, Lee Iacocca became the vice-president of the corporate car & truck group. Henry Ford wanted Lee
to rub some of that Mustang ointment onto the Lincoln-Mercury Division. Lee found out that Lincoln-
Mercury cars lacked their own style & identity. Due to Iacoccas intrapreneurial abilities, they came up
with two new entries in 1967 - Cougar & Marquis. Despite the success of Cougar & Marquis, the Lincoln-
Mercury division was actually losing money. In 1968, Lee came up with idea of Mark III, similar to the
Rolls-Royce of American Motors. Mark III outsold the competitor Cadillac Eldorado in its very first year
and Ford made almost $1 billion from the Lincoln-Mercury division alone.

Chapter 8 - The Road to the Top
By 1968, Lee was a favorite among the candidates for the next president of the Ford Motor Company. But
Henry Ford decided to appoint Semon Knudsen, known as Bunkie, as the president of Ford. Bunkie was
the vice-president of General Motors and GM wanted to get rid of Bunkie. It was difficult for Lee to digest
this turnaround and he even considered resigning. But Lee decided to stay since he loved the Ford Motor
Company. Bunkie tried to implement GMs methods in Ford & it backfired. Finally, Henry Ford decided to
fire Bunkie. Lee Iacocca became the president of Ford Motor Company on Dec 10, 1970. Despite being a
busy person, Lee found time to spend the weekends with his family, which highlighted the importance of
his family to him.

Chapter 9 - Trouble in Paradise
Lee got to know more about Henry Ford in his presidency years. Henry never wanted a close relationship
with anyone because he knew that he would have to turn against that person later. Lee convinced Henry to
produce small cars for Europeans and came up with the Fiesta which was a tremendous hit. Henry didnt
mind if his employees got publicity as long as it was tied to the product but if anyone got praised in his
spheres of influence, he couldnt handle it. Henry used corporate funds for all his personal use & despite
the many lawsuits against him, he got off easy once again. Henry was always a playboy. He hated women -


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except for his mother. He was the ultimate chauvinist & believed that women were incapable of
professional success. Henry was not only bigot, but also a hypocrite. He exhibited a high degree of
narcissism, machiavellianism and gender-bias.

Chapter 10 - 1975: The Fateful Year
In 1975, Henry Fords lifestyle took a toll on his health; he feared that Lee might take over his business
after his death & turn the place into Iacocca Motor Company (Anchorage bias). So Henry started his plan
to destroy Lee. When Lee was touring the Middle East, Henry called up a meeting and ordered that $2
billion be removed from future development funds as a major depression was imminent. When Lee was
absent, Henry authorized Paul Lorenz to pay a commission of $1 million to an Indonesian general. That
information got leaked to the public. Lee was shocked to hear that and he was forced to fire Paul despite
knowing that Henry was behind this. Henry tried everything he could to find a reason to fire Lee but
couldnt succeed. Lee knew that this was the beginning of his end at Ford.

Chapter 11-The Showdown
The Chapter describes the built-up to the day when Lee was asked to leave the company. It all started when
Henry started firing employees who were close to Lee like Bill Winn & Hal Sperlich. Even after all this
Lee still hoped that Henry would come to his senses, if not his brother Bill or the Board would knock some
sense into him. Henry brought in the management consulting firm to bring about a change in the structure
of the top administration, which brought the fight between Henry & Lee to the open. Fourteen months
down the line Henry made another change in the administration, he included a 4th member William Clay
Ford. Lee dropped to fourth in the hierarchical order. The board made a futile effort to pacify the situation.
Finally, Lee was asked to leave Ford. Lee was calm during the entire fiasco, which exhibited a high level of
Emotional Intelligence. Lee was in a sense relieved that all of this had come to an end. On the other hand
Lees family didnt take this too well. All his friends from Ford severed connections with him from the fear
of being fired.

Chapter 12 - The Day After
The after effects of Lee leaving the company were felt across by all the dealers. The Ford Dealer Alliance
was a very important group of stakeholders but the protest did not last long. Ford made a sincere effort to
assure the dealers that they wont be neglected. According to Lee, the reason why he was fired was that
Henry saw Lee as a threat to his position. But Lee never desired for the top position; he knew from the day
he joined Ford that it was a family owned company and that there would always be a family member at the
top. Lee was not even paid his due compensation. Lee met Henry only once after he left the company and
as Lee describes, Henry fled from the party with his wife.

Chapter 13 - Courted by Chrysler
This chapter discusses how Lee made his way to the top position of Chrysler. During the interim period he
met the board of members and the then Chairman John Ricardio to decide his future in Chrysler. He wanted
full autonomy to run the company according to his management styles. John Ricardio was a great leader;
he was willing to sacrifice his career to bring Chrysler back to life. Lee respected John for this. Lee only
demanded the salary he was offered at Ford because he knew Chrysler couldnt afford to pay him more.
This chapter shows how Lee derived his internal motivation to come up from such a big fall.

Chapter 14 - Aboard a Sinking Ship
CHRYSLER LOSSES ARE WORST EVER & LEE IACOCCA JOINS CHRYSLER were the two
headlines in the newspaper the day Lee joined Chrysler. Lee was a great observer. On the first day itself he
observed the behavior of the staff at Chrysler and realized that Chrysler was not run like a company; it was
a bunch of mini empires, where nobody cared what the others were doing. There was practically no


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communication between any departments. Lee tried to change the perception of Chrysler to the consumer.
Lee tried to bring the company back on track by clearing the Sales Bank and changing the manufacturing
model from production based to order based. Lee also promoted the car rental services which helped build
awareness of the brand. Slowly & steadily Chrysler was able to find steady ground.

Chapter 15 - Building the Team
All business operations can be reduced to 3 words - people, product & profits. Its essential to have the best
people in your team, which lacked in Chrysler. Lee brought in Gerald Greenwald, who was working in
Ford at that time. Other employees brought into the team were Steve Miller, Gar Laux (marketing & dealer
side), Hans Matthias (quality side) and Paul Bergmoser (purchasing side). These guys were able to bring
discipline to the entire operation. Lee & his team also took a risk by ending their relationship with existing
ad agencies & teamed up with an ad agency who was working with Ford. Not even Henry Ford was
expecting this. Lee also allowed this ad agency to be the members of their most important company
committees. This close association allowed the agency to come up with extraordinary marketing ideas
during the production of car itself, which was a notable example of Participative Management.

Chapter 16 - The day the Shah left town
The Iran revolution led to an oil crisis in the US. Sales of big cars, RV gas guzzlers came down drastically
with the public preferring smaller fuel efficient Japanese cars. Soon afterwards the economy nosedived into
recession. Annual car sales figures dropped by half. To stay alive Iacocca took drastic measures. Several
plants were shut, just in time inventory management was adopted; all dealership real estate was sold along
with most overseas operations. He sold Chryslers tank division which at the time was the only guaranteed
profit making operation, to raise cash to pay suppliers. That showed the prowess of his resource allocation
skills.

Chapter 17 - Drastic Measures - Going to the Government
In the summer of 1979 it was clear that only drastic measures could save Chrysler. Various options were
considered like bringing on board a benign investor, merging with Volkswagen and the use of refundable
tax credits. When none of these materialized and with bankruptcy looming, Iacocca decided to apply for
government loan guarantees. This was a highly controversial proposal with a lot of public debate. At the
time of the loan application, the US Treasury had outstanding loans of $409 billion. Even then, there were
many critics who were against the idea of Federal assistance for Chrysler and who believed in the survival
of the fittest.

Chapter 18 - Should Chrysler be Saved
The National Association of Manufacturers had an opinion that a loan guarantee or rather a bailout violates
the spirit of free enterprise and rewards failure. This opinion made Lee furious and he wrote a letter to them
highlighting various misdoings by the committee. He also suggested that Chrysler Corporation be removed
from the Business Roundtable membership. At the same time Lee did admit that the Chrysler management
made mistakes but the government was equally responsible because of its regulations. Then the loss that
would occur if Chrysler went bankrupt was calculated. It amounted to a loss of six lakh jobs and $2.7
billion during the first year alone. This influenced the government and they got a small portion of the loan
they actually wanted.

Chapter 19 - Chrysler goes to Congress
To get the full loan approved, Lee appeared before the Congress to present his case. He was humiliated
initially but was finally heard. He mentioned that the actions that Chrysler had taken to avoid the situation
they were in, and that they were not able to avoid this problem. He also highlighted his operating plan for
next 5 years. The government was still not convinced & refused to help. At the same time Chrysler's sales


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had dropped and they had lost consumer confidence. So Chrysler instead of promoting its products started
promoting the company and its future. The ad campaign that they ran played a major role in convincing
Congress to approve the loan guarantees. After this Chrysler did very well and managed to pay back its
loan seven years before it was due.

Chapter 20 - Equality of Sacrifice
Lee had decreased his salary to $1 a year. He engaged with the plant supervisors as well as the workers on
the shop floor. He followed the principle of equality of sacrifice, which helped him motivate his
subordinates. Doug Fraser, who represented the labor union, and who lobbied heavily with the Congress for
the financial loan became the chairman of Chryslers public policy committee. This was a master move as
this helped gain the confidence of the labor as somebody represented them on the board at Chrysler.
Furthermore to take care of the health care benefits to be given, four employees including Lee and Doug
became part of the health care committee. These contributions highlighted the leadership & team-building
qualities of Iacocca.

Chapter 21 - The Banks: Trial by Fire
A memo of liquidation was prepared by the bank and they were in for a rude shock. They saw that if
Chrysler declared itself bankrupt then it would take 5-10 years for the matter to be resolved in courts and
they would get a very meager rate of interest. Banks started realizing that it was in their best interest to
keep Chrysler in business. At the same time they were talking to Steve Miller regarding them getting the
first share of repayment of loan. But after a lot of negotiations and discussions Steve and the bankers struck
a deal. Finally, Chrysler received its first installment of federally backed loans.

Chapter 22- The K-Car and a close call
Chrysler had brought their new model, the K-Car to the market. The public picked up the K-Car theme and
Chrysler started using it in the advertisements. There were problems pertaining to the sales of the K-Car,
and the mounting interest on loans was also a major issue. At one stage the merger of Ford and Chrysler
was considered by Iacocca and the pros and cons of the merger was analyzed. But the merger never went
through. Ford had preconceived notions that they might actually be at a loss in the merger, which was an
unfortunate case of selective perception.

Chapter 23 - Public Man, Public Office
This chapter outlines the appearance of Lee Iacocca in Chryslers TV commercials & the change in
perception of the public towards him. Initially Iacocca was apprehensive towards appearing in public
commercials as he did not want consumers to get the perception that Chrysler was desperate. But after
many discussions with his advertising consultants, he agreed to the same. It resulted in a desirable effect, as
consumers perceived that Chrysler was under new, better management and as a personal guarantee from
Iacocca himself. However, those commercials were also seen in another light. Rumors of him gunning for
Presidency started surfacing, as the public believed that a person capable of reviving a drowning
corporation can also do the same with the government of America (an example of Halo effect in play from
the publics perspective). However, it resulted in the opposite of the self-fulfilling prophecy. Iacocca did
not pursue it.

Chapter 24 - A Bittersweet Victory
Iacocca turned Chrysler around irrespective of the poor economy. He even paid back the government loan
seven years before it was due. Also, Chrysler made a record profit of $925 million (1983). Following that,
they launched their own convertible, resurrecting a niche class of convertibles that had previously faded
away. This chapter highlights that such a tremendous victory was accompanied with its own lows, the
biggest of them being the death of his wife, Mary. She was his lifelong companion and had been through


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great personal stress through his episodes with Ford and Chrysler, but she never gave up on him. Another
issue was that with the government, which practically robbed Chrysler using the loan agreement.

Chapters 25-28 - America
In these chapters Iacocca talks about issues which are close to him. First he talks about road safety and how
seat belts help in saving lives. He was one of the first proponents of compulsory seat belts use and was in
favor of legislating the same. He describes the labor scenario at that time and explains its successes and
failures and what needed to be done to improve the situation back then. He talks about the contentious
points between management and labor, and how labor laws evolved over the years. Iacocca discourses on
the Japanese, their work culture, ethics and self-interest. He explains the reasons for the unprecedented
economic success of the Japanese and what America needs to do to become competitive against them.

5. Theoretical Frameworks

1) Mintzberg's Management Roles
We can see that Iacocca performed Interpersonal, Informational and Decisional roles.
Figurehead- Iacocca was the symbolic head for Chrysler. Its effect was prominent when he
appeared in Chrysler advertisements.
Leader- Iacocca was responsible for turning Chrysler around. He restructured the organization
bottom-up, gave direction to the employees and motivated them, especially through the principle of
equality of sacrifice.
Liaison- Iacocca maintained a vast network of contacts outside of Chrysler, most of which he had
built though his career with Ford. He leveraged those contacts in almost all aspects of his business
in Chrysler, ranging from labor unions to dealers.
Monitor- Iacocca served as the nerve center for internal and external information of the
organization.
Disseminator- Iacocca was an excellent disseminator, as he continuously informed his employees,
even at the bottom level, about the happenings of the outside world, especially during Chrysler
crisis.
Spokesperson- From his days in Ford, Iacocca understood the importance of transmission of
information. He bore the brunt of the media during Chryslers bad days, but he was also the face of
its new, successful management.
Entrepreneur-Doing something different had become something of a habit for Iacocca. He devised
the Ford Mustang concept, which turned Ford around. On joining Chrysler, he re-launched the
convertible car, which had been presumed to be a failure in the then-current market.
Disturbance Handler- Iacocca personally interacted with labor union heads in order to ensure that
there is no possibility of any setbacks due to labor related issues.
Resource Allocator- At both Ford & Chrysler, Iacocca strategically allocated and disposed of
resources based on the companys future plans. One notable example was when he told Chryslers
tank division even though it was making a guaranteed profit of $60 million per annum.
Negotiator- If there was one thing that set Iacocca apart, it was his negotiating skills. He negotiated
with dealers, trade unions and even with the government when it came to borrowing 1.2 billion
dollars from it!

2) Exit-Voice-Loyalty-Neglect Framework
Iacocca usually operated under the constructive & active dimensions. On very rare occasions did he
follow the passive dimension, one of them being his experiences with Henry Ford. One of his greatest
regrets was that he should have quit Ford before Henry Ford fired him i.e. Exit framework.



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3) MBTI framework & Big 5 Personality Model
Lee Iacocca fell under the ENFJ category. He generally perceived himself to be an introvert by nature.
However, he exhibited a greater degree of extraversion as he was a very efficient communicator, and had
established himself as an assertive person. He always looked at the bigger picture, whether it was in Ford or
in Chrysler. For example, when the market showed favor towards smaller, fuel efficient cars, he suggested
that Ford invest in that field. However, Henry Ford brushed him aside as Henry Ford did not want to
experiment. Another notable example is how he drafted the four 15s proposal to help the government cut
its fiscal deficit in half. Sadly, that was rejected too. Thus, he was highly intuitive in nature. Iacocca was
very value-driven and placed a lot of emphasis on them. But his most prominent characteristic was that he
was very orderly and systematic. He proved its usefulness when he introduced the concept of structured
hierarchy in management & operations in Chrysler, which resulted in a major improvement in the
companys performance. Thus, he can be classified under the Judging dimension in the MBTI framework.

4) Person Job Fit
Lee Iacocca can said to be a mix of three personality types- Social, Conventional & Enterprising, all three
of which are neighboring each other in John Holland's personality-job fit theorys hexagon. However,
his predominant personality type is Enterprising, and he has known that since he started working at Ford.
At the very beginning of his career, he proactively approached his manager and asked to be shifted to the
marketing department of Ford, even though that career path was not risk free. Since then however, he had
not left that field, irrespective of other opportunities coming his way. Also, at Chrysler, he noticed that
employees werent being utilized in their particular skill sets. He made sure to restructure the whole
company ground up so as to increase specialization efficiency.

5) Goal setting theory
At Ford, Iacocca noticed that there was a large communication gap between management and labor. He
attributed it to the fact that there were no formally scheduled meetings where a manager could have a sit
down with his subordinate and discuss short term goals. He introduced the concept of the quarterly review
system- which included short term and long term goal specificity and post-achievement feedback in Ford.
That alone increased Fords efficiency by a huge margin.

6. Relating theory to practical aspects of Human Behavior

1) Transformational Leadership
Lee Iacocca was a transformational leader who catapulted Chrysler from bankruptcy to profitability. A few
of the measures which Lee took at Chrysler are trimming of non-essential management, limiting financial
rewards for all employees and building fuel efficient and innovative cars which would be demanded by the
customers in the future. Iacocca personally appeared in television ads and signed the print ads to signal that
a new management was at the helm at Chrysler.

2) Charismatic Leadership
Lee Iacocca was a charismatic leader beyond par. He had a vision of where he wanted to take Chrysler
which he articulated over and over again in Congress. He had a vision of a successful and efficient
corporation and mobilized employees to align behind that vision. He took a huge amount of personal risk
by taking over Chrysler at a highly turbulent time. He reduced his salary to $1 to ensure the equality of
sacrifice. He was cognizant of the needs of his employees. Even when he had to fire people to keep
Chrysler alive he did so with compassion and a degree of sensitivity. He is beacon of an effective
unconventional leader. Personally signing and appearing in advertisements, appointing a union leader to the
board were a few of his unconventional actions.



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3) Situational Leadership theory
Initially at Chrysler, employees were assigned to tasks outside their area of specializations. Also, due to
lack of communication between management and other employees, and due to a highly unstructured
system, there was very little motivation among employees. Therefore, they were unable & unwilling to
carry out their activities. Iacocca gave them clear and highly specific directions and restructured the whole
organization.

4) Reward Systems- Chrysler was rewarding its stakeholders with dividend, increase in salary and other
perks. But this was at the cost of Chrysler raising loans from the bank. This was one of the reasons why
Chrysler was about to get bankrupt. But later on, to cut costs and turn Chrysler into a profitable
organization employees were laid off, Lee worked on a salary of $1 a year, no dividends were paid and
salary cuts were done.
Practically, rewarding systems depend on the financial health of the company. This is done to ensure that
the company survives and continues to exist for the welfare of the economy as well as that of the
employees.

5) Employee engagement- It is one of the major job attitudes. With reference to the book we can relate it
to Steve Miller (the man behind the negotiation with the bank to release loan money). He had a routine
which was simply unbelievable. He would work for eighteen hours a day. Even his meals were occupied by
having meetings with the lawyers and bankers.
In the scenario mentioned above, Steve was committed to the work he was doing. He was involved,
engrossed and enthusiastic to achieve the goal of getting loan from the bank. And this is what happens in
life when an individual is motivated and feels a deep connection to the company.

6) Employee Involvement- In an unprecedented move Iacocca appointed Douglas Frazer head of the
United Auto Workers union and a Chrysler employee to the board of Chrysler. At the time the book was
written, the workers at Chrysler accounted for 17% of the company. Lee was of the opinion that workers
owning a piece of the action doesnt interfere with good management. A line from the book which was said
by Lee was- What do I care if the companys stock was owned by a brokers account on Wall Street or by
Joe Blow who works on the assembly line?. Lee was a man who believed in involving the employees of
the company. And what better way than giving them a share in the company. And this is exactly one of the
ways in which companies involve the employees even today.

7) McClellands theory of needs
Need for achievement: Lee recognized the need for an individual to excel and to achieve. He encouraged
and motivated people to put in their best efforts. He set standard benchmarks for performance like sales
reached, quality control, overall financial performance and rewarded people for achieving those
benchmarks.
Need for Power: Lee believed that people do their best work when they are empowered to take decisions
and ownership of their work. He did not micromanage and gave his subordinates the freedom to run their
teams as per their wishes.
Need for affiliation: Iacocca inculcated a strong team culture both at Ford and Chrysler. He had close
interpersonal relations with his subordinates. As a testament to his leadership, when he moved from Ford to
Chrysler most of his former team joined him at Chrysler.

8) Halo effect
Having taken Chrysler from bankruptcy to profitability, Lees popularity among the public soared, so much
so that when it was rumored that he would be running for President of the US, people immediately bought
it and showed their enthusiasm. The media conducted opinion polls and found that a large portion of the


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public wanted Lee to run for President. This was the Halo effect in play as the people saw that Lee was an
effective business leader and extrapolated that he would be an effective President.

9) Emotional Intelligence
Since the beginning of his career, Iacocca had always exhibited a high degree of emotional intelligence. It
can be illustrated through several examples in the book.
a) Self-Awareness- Iacocca was a confident and emotionally self-aware leader. Another notable
example was that of John Ricardio, who was willing to step down from the position of CEO just so
that Chrysler could be saved.
b) Social Awareness- He displayed empathy towards all employees of the organization. He valued the
importance of undermined employees.
c) Self-Management- He was a trustworthy and conscientious person. He took the initiative as
displayed in the 56 for 56 scheme. He had a high achievement drive which he displayed throughout
his career. He displayed a high level of self-control during his final years at Ford and during his
episode with Henry Ford. One notable example in his fiasco with Henry Ford- Iacocca accepted
Fords irrationality. He was undergoing high levels of emotional dissonance, but even then he
managed to stay composed throughout.
d) Relationship Management- He focused on team-building especially when he took over Chrysler.
He built strong interpersonal bonds with his colleagues. He drove his vision for the company into all
the employees. Change catalyst- He brought about many changes in Ford and more so in Chrysler.
For example, while Ford management generally took dealers for granted, he realized that they were
the main point of contact to the consumers. They were essentially in business with dealers, and not
the consumers. Keeping the dealers happy resulted in consumers being happy.

7. Learning & Conclusion
Below are the learnings we took from this book, which Lee exemplified as can be seen from his quotes.
a) Lead through example- The speed of the boss is the speed of the team
b) Work-Life balance- The only rock I know that stays steady, the only institution I know that
works, is the family
c) Dedication & Commitment- To succeed, you have to set priorities, decide what you stand for
d) Motivation- Motivation is everything. You can do the work of two people but you cant be two
people. Instead, you have to inspire the next guy down the line and get him to inspire his
people
e) Perseverance- In times of great stress or adversity, its always best to keep busy to plough your
anger and energy into something positive.
f) Innovation- We are continually faced by great opportunities brilliantly disguised as insolvable
problems
The book teaches us the various methods & ideas used by Lee Iacocca during his tenure at Ford and
Chrysler. It shows how a company can be successful through leadership and innovation. Also, it shows that
true leaders always want to achieve success in whatever task they are involved in. It teaches us how to
remain optimistic during the toughest of times, using Iacocca as an example, as he was able to turn around
the fortune of a company hit by bankruptcy by using apt techniques of organizational behavior.


8. References

http://www.baylorfans.com/forums/archive/index.php/t-17009.html
http://www.brainyquote.com/quotes/authors/l/lee_iacocca.html